If your contract is coming up for renewal, as many are, be sure to make the most of that window.
U.S. community banks and credit unions can expect to spend more quality time with their payment network providers in 2020 and beyond. Within this market segment, a disproportionately large number of network agreements will be up for renewal in the coming months. These are long-term contracts, some lasting as long as a decade, that set the terms for the greater part of most community financial institutions’ costs and non-interest revenue streams.
History seems to repeat itself in some ways; many of these expiring agreements were entered into during shortly after the 2008 financial crisis, with the introduction of the Durbin Amendment. During that time, as now with COVID-19, the outlook for consumer spending and credit was unclear. Despite similar conditions in recent news, the payments world looks quite different today compared to when those agreements were last signed.
Card network providers regularly work their lists of clients and prospects, looking to ways to entice renewals or conversions.
Over the coming months, they will continue and, perhaps, increase their efforts, especially at the institutions where agreements are expiring over the next 12-24 months.
Considering how things have changed in payments over the last decade, it is now more important than ever that these offers and “special deals” be considered carefully—very carefully.
A CUESolutions provider, SRM, Memphis, Tennessee, consults about lowering costs, increasing revenue and automating processes.